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Brent oil futures rise towards $90 as supply risks intensify
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Brent oil futures rise towards $90 as supply risks intensify
Apr 3, 2024 5:09 AM

*

Oil prices continue rise as supply risks move into focus

*

OPEC+ ministerial meeting makes no recommendation on

policy

*

Taiwan's Formosa refinery restarts after brief halt

following

earthquake

*

U.S. EIA stock data to be released at 1430 GMT

(Updates prices at 1130 GMT)

By Robert Harvey

LONDON, April 3 (Reuters) - Oil prices extended gains on

Wednesday, as investors mulled supply risks stemming from

Ukrainian attacks on Russian refineries and the potential for

escalation in the Middle East conflict, while OPEC+ ministers

made no changes to current output cuts in a meeting.

Brent crude futures for June rose 75 cents, or

0.84%, to $89.67 per barrel at 1130 GMT, while U.S. West Texas

Intermediate crude futures for May gained 73 cents, or 0.86%, to

$85.88 a barrel.

OPEC+ ministers made no fresh policy recommendations in a

meeting on Wednesday, two sources said, after the group already

decided to extend current production cuts until June last month.

Oil futures compounded Tuesday's gains, when both Brent

and WTI climbed 1.7% to their highest since October.

Prices jumped higher on Tuesday after a fresh round of

Ukrainian drone attacks on Russian refineries threatened to take

even more of the country's processing capacity offline.

Investors were also concerned that conflict in the Middle

East could spread, after Iran vowed revenge against Israel for

an attack on Monday that killed high-ranking military personnel.

A wider conflict in the Middle East involving more

oil-producing nations could cause supply disruptions. Iran,

which provides support for the Hamas militia fighting Israel in

Gaza, is the third-largest producer in the Organization of the

Petroleum Exporting Countries (OPEC).

"The rise in hostilities in both hotspots pushed the price

of the two crude oil futures contracts to their highest levels

this year," PVM analyst Tamas Varga said of Tuesday's rise.

Bank of America Global Research

raised

its 2024 Brent and WTI forecasts to $86 and $81 a barrel

respectively, it said in a note on Wednesday, on firming demand

and escalating political tensions.

"Geopolitical turmoil has also boosted oil demand via

longer trade routes and impacted supply by reducing refining

capacity via attacks on Russian energy infrastructure." the bank

said.

Elsewhere on Wednesday, Taiwan's strongest earthquake in at

least 25 years briefly caused Formosa Petrochemical to halt

operations at its Mailiao refinery as a precautionary measure,

but works have since restarted.

The U.S. Energy Information Administration (EIA) will also

release oil inventory data later on Wednesday. Data from the

American Petroleum Institute reported crude inventories fell by

2.3 million barrels last week, traders said on Tuesday.

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